January 10th, 2018
Information and communication technology revolution and impact on human capital
The revolution of information and communication technology has changed the way people work across the globe. By reducing the geographical and time barriers among countries, information technologies have provided entities with a means of outsourcing some of their functions in low-wage countries (Enderwick, 2009). Such ability of entities to outsource their processes in other countries has reduced the relationship between entities’ performance and the economic performance of their parent countries. This arises since entities can increasingly advance their profits by capitalizing on the cost efficiencies provided in foreign countries while avoiding increased wages in the home country. In turn, by averting the increase in wages in home countries, employees in such countries would not have higher disposable incomes hence cannot contribute to the growth of the economy through increased consumption. In effect, the entities would be enhancing their earnings without such enhanced earnings having spill-over effects to the home-country economies.
Revolution of the information and communication technology has also enabled individuals to learn diverse cultures of the world. For instance through such increased communications, individuals in countries such as China, India, Latin American countries and a number of African countries have become conversant with the English language. Such occurrence of a multilingual population has offered such a population a competitive advantage in a global economy. For instance, China and India have become key markets in the 21st century challenging the traditional consumption economies such as the U.S (Enderwick, 2009). Although initially such countries attracted foreign investment out of their low-cost environments offering less-skilled labour, subsequently, the discovery of multiple destinations that can offer such less-skilled labour has resulted into countries such as China and India orienting themselves to offer high-skilled labour (Enderwick, 2009). Such has for instance been evident in India where professions such as computer science have attracted higher number of graduates who can compete in the global market.
A core development of the information age has for instance been the Internet, which has shifted the focus of entities from relying on production activities to offering services. Entities such as IBM and Xerox have for instance been able to reinvent themselves and avoid failure by adopting services as core products to establish strong customer relations. The Internet has also eroded other sources of competitive advantage such as controlling a strong distribution channel by allowing even small enterprises to integrate forwards by selling their merchandise via websites. Through such effects, the internet has been at the centre in shaping the development of business strategies with a global outreach.
For Canada, the changing dynamics necessitates it to reposition its multicultural composition to become a source of competitive advantage in the new global economy. For instance, with respect to emerging markets, the country can use the individuals sharing a cultural identity with such emerging markets to foster strong relations. Additionally, such a multicultural composition can serve as a basis upon which the country can increase its cultural awareness of the regions that are turning to be the next frontiers for growth. A further aspect that Canada could benefit from such global trade is creating conducive environment for foreign direct investments. Such would for instance involve enhancing its commitment to multicultural society and enhancing its security so as to provide a stable environment that can attract investors seeking for long term investment opportunities.